Perth

Q3 Office stats show Perth CBD has highest A-grade office vacancy in the country

​PERTH, 10 October 2014 – JLL’s third quarter office statistics, released this week, indicate a significant jump in Perth CBD office vacancy, an expected outcome according to JLL Head of Office Leasing WA, Nick Van Helden.

Mr Van Helden said the latest statistics indicate the Perth CBD has the highest A-grade office vacancy in the country.

“As it currently stands, 15.8% of A-grade buildings in the Perth CBD are vacant, and the overall vacancy levels are sitting at 14.7%.

“Much of the sublease space in these A-grade buildings can be attributed to resource sector and resource related companies downsizing.

“The jump was not unexpected given vacancy rates are forecast to peak at 16.4% next year, due to the substantial new supply coming on line,” said Mr Van Helden.

According to JLL’s Research Analyst WA, Sophie Fletcher, the increase can be attributed to the combination of increase in supply entering the CBD market and the significant, existing direct and sublease supply.

“Over time vacancy levels will regulate as tenants shift from lower grade buildings, which will in turn see vacancies in secondary grade stock, a trend more in line with what is happening in other capital cities.

“Perth has a high percentage of older buildings with smaller floor plates, which will likely also encourage tenant movement,” said Ms Fletcher.

JLL WA has leased over 40,000sqm in 75 leasing transactions in the year to date across the CBD and non-CBD office markets with an additional 12,000sqm committed and waiting execution of leases - a satisfactory level of leasing activity, according to Mr Van Helden.

“While these numbers are down on previous ‘boom time’ years, it still serves as evidence of good levels of market activity.

“However, given these deals are predominantly moves rather than tenant expansion, vacancies will continues to grow.

“Now is the time for tenants to be exploring their options as there are some very attractive, higher grade alternatives available in the CBD market,” said Mr Van Helden.